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SK Foods was a California-based agribusiness company, with two packing and processing plants in Williams, California and Lemoore, California, respectively. It was a major tomato processor. SK Foods, Ingomar Packing Co. and Los Gatos Tomato products formed the California Tomato Export Group, (CTEG), which collectively produced over half of the U.S. supply of tomato products at the time of the group's formation in 2005. The company's Williams plant has employed hundreds of people each summer to can and process tomatoes during harvest season.
Controversy
Former owner Frederick Scott Salyer was arrested on racketeering and corruption charges in early 2010 stemming from a five-year investigation of practices in the processed-tomato arm of his company SK Foods by the United States Department of Justice. The investigation was prompted by an SK Foods executive who admitted a $1 million embezzlement from another company and turned into a key informant against Salyer. Investigators alleged that the company bribed buyers such as Frito-Lay, Kraft Foods and Safeway to accept moldy rotting tomatoes, to pay above-market prices, and to provide SK with information on competitors' activities. Court documents filed by the lawfirm of Keker and Vannest state Salyer and SK Foods never paid any bribes. As lower-level company officials cut deals with prosecutors, SK Foods lenders forced an involuntary Chapter 11 bankruptcy instant action in May 2009. It was acquired out of bankruptcy in June 2009 by Olam International, based in Singapore. It is now known as Olam Tomato Processors. An associated produce company, Salyer American Fresh Foods, was forced to close after its lenders stopped providing the company with money.
On March 23, 2012, Salyer signed a Plea Agreement supplied by the United States Department of Justice admitting to one count price-fixing in the Antitrust case and one count racketeering in the RICO 1964 case, counts 1 and 8. If convicted, one RICO count alone would carry a 30 year mandatory minimum sentence according to the United States Federal Sentencing Guidelines. Before ordering Scott Salyer to spend six years in prison, a federal judge on Tuesday appeared perplexed how the former millionaire agribusiness owner ended up in the jam he confronted in a 15th-floor courtroom.
U.S. District Court Judge Lawrence K. Karlton questioned why the 57-year-old threw away a Monterey-based farming empire that stretched from the San Joaquin Valley to New Zealand. "Here's a millionaire who risked everything for nothing,” the judge said. "I don't understand it.”